Date Published: 07/21/11
UBA releases Half Year 2011 Results with strong Balance Sheet Growth and Improved Profitability
One of Africa’s largest financial services Groups, United Bank for
Africa (UBA) Plc, released its financial performance for the first
half ended June 30, 2011. The results were impressive, as the Group
recorded noticeable improvements across major lines of the income
statement and recorded strong growth in financial position at the end
of the period.
Gross earnings of N87.7 billion were recorded in the first half of the
financial year, as the mix of interest and non-interest income was
slightly altered from recent trends. Non-interest revenues grew by 17%
to N30.3 billion, leading to an increase in the proportion of
fee-based income to 35% in the first half of 2011. It is instructive
to note that the benefits of risk asset expansion are yet to impact on
fund based incomes, thereby presenting ample room for revenue
expansion in the second half of the year.
Operating income rose to N65.5 billion (N63.7 billion in 1H10) on the
back of strong fee-based incomes
Profits before tax was N10.1 billion compared to N8.6 billion recorded
in the corresponding period of 2010, while profits attributable to the
Group rose by 90.3% to N8.2 billion (with its bank subsidiaries in
Africa contributing to Group results). According to Mr. Emmanuel
Nnorom, Executive Director – Finance, “UBA’s performance was bolstered
by Management’s concerted efforts to curtail operating costs evidenced
by a 2.4% reduction in OPEX from N51.8 billion in June 2010 to N50.6
billion in June 2011; in spite of the N4.9 provision charge made to
the income statement”.
Overall the balance sheet size strengthened further with total assets
and contingents closing 17.1% higher than the full year 2010 position
to N2.66 trillion. This growth was driven by risk asset expansion
recorded during the period under review. Attesting to the essence of
its wide distribution channels and the quality of some retail
liability products launched during the period, deposit base grew by
11.4% to N1.41 trillion (N1.27 trillion in December 2010).
In line with full year projections, loan book has also grown by almost
14% to N715.8 billion, bringing Group loan-to-deposit ratio to about
51%. Whilst the Group looks forward to enhanced interest revenues from
increased lending, it continues to seek avenues to extend quality
credit to its teeming customers and clients. Notwithstanding, UBA
maintained a good proportion of liquid assets in its aggregate asset
base closing with a liquidity ratio of 42% at the end of the period.
Driven by solid shareholder funds of N187.1 billion (N179.4 billion in
December 2010), capital adequacy ratio remained strong at 17%.The release of the half year results coincides with the announcement
of key Management appointments, as part of the steps required to
re-organizing its operations in line with the Financial Holding
Company model. As a Financial Holding Company, the Group will be known
as UBA Holdings Plc; comprising of UBA Nigeria Plc, UBA Capital
Holdings and UBA Africa Holdings as subsidiaries. The move is aimed at
strengthening its operational excellence and pan African aspirations.
UBA Nigeria Plc is a commercial bank with International banking status
and oversees the banking operations in Nigeria, New York, and UBA
Pensions Limited. The entire Group’s banking operations/subsidiaries
in Africa (currently 18) will be embedded in UBA Africa Holdings
Limited, while UBA Capital Holdings Limited will hold all the Group’s
non-bank businesses.
UBA is a leading Pan African financial services Group with presence in
19 African countries, New York, London and Paris. Headquartered in
Lagos, Nigeria, the Group provides universal banking services to its
diverse customer groups.
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